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Prewitt Enterprises, which has had the Sitka school bus contract for 38 years, has been underbid on a new contract by a national bus company, Laidlaw Education Services.
School officials said the difference between the two bids for school bus service is 9.1 percent, a gap too large to allow a negotiated settlement with the lower bidder.
School Superintendent Steve Bradshaw said a decision on the contract will be made at the School Board meeting in March.
"Unless there is something out there we're not aware of, the board will most likely have to accept the lower proposal, which is for Laidlaw," Bradshaw said.
Prewitt said he is sorry to lose the contract after nearly four decades.
"It's been a joy being the local contractor," said Prewitt, who was hired in 1960 at $20 a day to drive the district's single school bus. In 1964, he was awarded his first contract to provide bus service for the school district.
"Now some of the kids we haul are the grandchildren of people we hauled in 1960," he said.
But in the end, he feels his company does not have the assets to go up against a powerhouse like Laidlaw.
"It's like a competition between David and Goliath, and I don't have enough rocks in my slingshot to counteract that," he said.